Head of Federal Reserve Bank of Richmond quits after leak of confidential data

WASHINGTON — The president of the Federal Reserve Bank of Richmond resigned Tuesday as he disclosed his role in a leak of confidential information about the policy options that the Fed was considering in 2012.

Jeffrey Lacker said during a phone conversation with an analyst from Medley Global Advisors in October 2012 that the analyst brought up an “important non-public detail” about Fed policymakers’ discussions before a meeting, according to a statement emailed Tuesday by the law firm McGuireWoods in Richmond, Va. Because of the confidential and sensitive nature of the information, Lacker said he should have declined to comment or immediately ended the call.

“Instead, I did not refuse or express my inability to comment and the interview continued,” he said.

Lacker said he also failed to report to the Federal Open Market Committee that the analyst was in possession of confidential market committee information. The day after, when the analyst published details of one of the policy options in a report for subscribers, Lacker said he realized his failure to comment on the information was seen as a confirmation of it.

“I regret that in this instance I crossed the line to confirming information that should have remained confidential,” Lacker said. “In 2012, my conduct was inconsistent with those important confidentiality policies.”

Lacker, who had previously announced he would retire in October, declined to comment beyond the statement when contacted by phone Tuesday.

The Medley report led to an internal Fed investigation, and Lacker said he failed to provide a full account about his conversation with the analyst in a questionnaire and interview with the Fed’s general counsel in December 2012.

The Justice Department and FBI joined the inquiry in 2015 amid pressure from Congress for details about the leak. Lacker said that during that year, he disclosed the breach to law enforcement officials in an interview during their investigationd.

In its September 2012 meeting, the market committee decided to buy $40 billion a month of mortgage securities in the third round of so-called quantitative easing. The Medley report, titled “Fed: December Bound,” telegraphed the possibility that $45 billion of U.S. Treasury purchases would be added to the program.

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